US CPI Slows to 3.4% Year-Over-Year, Core Inflation Eases to 2.5%

US headline inflation decelerates to 3.4% and core to 2.5% in July. Fed holds rates at 3.50%-3.75%. Soft data may ease rate hike fears, supporting Bitcoin.

Woofun AI data shows that the U.S. Consumer Price Index rose 0.1% in July on a seasonally adjusted basis, with headline inflation slowing to 3.4% year-over-year. Core CPI increased 0.2% monthly and eased to 2.5% annually, down from 2.6% in June. Shelter accounted for roughly two-thirds of the monthly increase despite a 0.1% rise, while energy declined 1.5% but remained 14.7% higher than a year earlier.

The Federal Reserve maintained its policy rate at 3.50%–3.75% on July 29, though three policymakers favored a 25-basis-point increase. The softer inflation print provides ammunition for dovish arguments, potentially reducing the likelihood of another rate hike before the September 15-16 meeting. This macro shift may benefit Bitcoin by lowering the hurdle for capital allocation to speculative assets, as reduced rate-hike expectations typically loosen financing conditions.